ad pepper media International N.V.

FIRST BERLIN Equity Research ad pepper media International N.V. RATING The Netherlands / Internet Services Frankfurt Final 2017 figures PRICE TARGET 4.80 Bloomberg: APM GR Return Potential 30.4% ISIN: NL0000238145 Risk Rating High 61% EBITDA INCREASE EXPECTED IN 2018E UPGRADE TO BUY Dr. Karsten von Blumenthal, Tel. +49 30 80 93 96 85 10 ad pe BUY ad pepper s final figures corresponded to the preliminaries. 2017 figures showed record sales and earnings. Sales grew 24% y/y to 75.6m and EBITDA 26% y/y to 2.2m. Thanks to the strong Q4, ad pepper topped its EBITDA guidance of > 1.5m. We believe that the buoyant online advertising markets and the company s very good competitive position will continue to drive growth and profitability this year. Although the 2018 guidance ( strong growth with higher EBITDA ) does not indicate how strong EBITDA growth could be, we stick to our earnings forecast (2018E EBITDA: 3.6m, +61% y/y). We have lowered revenue estimates in accordance with the changed IFRS regulations. An updated DCF model yields a 4.80 price target (previously: 4.50). Following the recent share price decline, we upgrade the stock from Add to Buy. All three segments showed strong revenue growth and delivered significant EBITDA contributions All three segments grew at double-digit rates and delivered significant EBITDA contributions of between 1.0-1.3m. We view this as a clear sign that all three business models are performing well. Holding costs were slightly lower (Admin segment EBIT: -1.5m). All three operating subsidiaries are well-positioned in the market and investments in Webgains (artificial intelligence, machine learning, platform relaunch) and ad agents (17 new employees) look set to pay off in 2018E. The holding continues to keep costs firmly under control (G&A slightly lower y/y despite strong growth). Guidance: Increasing EBITDA ad pepper is guiding towards strong growth with higher EBITDA. This guidance has not yet inspired investors. We believe that each segment will grow at a double digit rate in 2018E and increase earnings. On the group level, we continue to forecast EBITDA of 3.6m (+61% y/y). FINANCIAL HISTORY & PROJECTIONS (p.t.o.) 2015 2016 2017E 2018E 2019E 2020E Revenue ( m) 56.01 61.16 75.56 38.89 44.54 51.03 Y-o-y growth n.a. 9.2% 23.5% -48.5% 14.5% 14.6% EBIT ( m) 0.24 1.61 1.82 3.14 4.52 5.80 EBIT margin 0.4% 2.6% 2.4% 8.1% 10.1% 11.4% Net income ( m) -0.03 0.63 0.58 1.56 2.45 3.30 EPS (diluted) ( ) 0.00 0.03 0.03 0.07 0.11 0.15 DPS ( ) 0.00 0.00 0.00 0.00 0.00 0.00 FCF ( m) 1.60-0.54 2.67 2.14 3.12 3.62 Net gearing -107.6% -126.0% -128.1% -128.9% -128.7% -126.0% Liquid assets ( m) 16.93 17.86 20.13 22.27 25.39 29.01 RISKS The main risks are regulatory changes, technological innovations, dependence on key customers, and intense competition. COMPANY PROFILE ad pepper media International N.V. is an international digital performance marketing company, which acts a a holding for its three operating units ad pepper media (lead generation & audience targeting), Webgains (affiliate network), and ad agents (full service agency). The company is headquartered in Nuremberg, Germany. MARKET DATA As of 09 Apr 2018 Closing Price 3.68 Shares outstanding 21.00m Market Capitalisation 77.28m 52-week Range 1.91 / 4.42 Avg. Volume (12 Months) 21,839 Multiples 2016 2017E 2018E P/E 123.9 134.3 49.9 EV/Sales 0.9 0.8 1.5 EV/EBIT 35.9 31.8 18.4 Div. Yield 0.0% 0.0% 0.0% STOCK OVERVIEW 4.6 4.2 3.8 3.4 3 2.6 2.2 5715 5515 5315 5115 4915 4715 1.8 4515 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 Apr-18 ad pepper media International N.V. Prime All Share Index COMPANY DATA As of 31 Dec 2017 Liquid Assets 20.13m Current Assets 34.90m Intangible Assets 0.36m Total Assets 38.62m Current Liabilities 21.70m Shareholders Equity 16.52m SHAREHOLDERS EMA B.V. 41.2% Treasury Stock 8.7% Axxion S.A. 5.1% Dieter Koppitz 3.0% Free Float 42.0% Analyst: Dr. Karsten von Blumenthal, Tel. +49 30 80 93 96 85

Balance sheet remains strong The cash position increased to 20.1m from 17.9m in 2016. As securities available for sale amounted to 2.5m (2016: 1.7m), available liquid funds rose by 15% y/y to 22.6m. Because ad pepper has no financial debt, the net cash position is also 22.6m. In our view, ad pepper thus has ample financial means to develop its business, either organically or via acquisitions. Trade receivables increased from 10.1m to 14.1m, but working capital remained negative ( -3.7m) as payables rose from 12.4m to 17.8m. Equity increased from 15.0m to 16.5m (+10% y/y ), but the equity ratio declined from 48% to 43% as the balance sheet total increased from 31.4m to 38.6m (+23% y/y). Strong free cash flow ad pepper s operating cash flow rose to 3.1m (2016: 0.0m). Free cash flow was 2.7m due to CAPEX of 0.4m. Thanks to its profitable business model, low CAPEX requirements and negative working capital, we believe that ad pepper will continue to generate high free cash flows. Figure 1: Reported segment figures 2017 vs. 2016 All figures in m 2017 2016 Delta ad pepper media Sales 6.91 5.27 31.1% EBITDA 1.07 0.49 120.6% margin 15.5% 9.2% - Webgains Sales 51.40 43.90 17.1% EBITDA 1.31 1.54-15.0% margin 2.5% 3.5% - ad agents Sales 17.35 12.01 44.5% EBITDA 1.26 1.16 8.7% margin 7.3% 9.6% - Admin Sales 0.27 0.24 11.5% EBITDA -1.33-1.42 - Intersegment elimination Sales -0.37-0.26 - EBITDA -0.10-0.01 - Group Sales 75.56 61.16 23.5% EBITDA 2.21 1.75 26.4% margin 2.9% 2.9% - Source: First Berlin Equity Research ad pepper media segment generated significant EBITDA margin increase The ad pepper media segment sales soared more than 29% to 6.9m (2016: 5.3m). Gross profit climbed by almost 37% to 3.2m. The gross margin increased by 2.4PP to 46.7%. Segment EBITDA doubled from 485k in 2016 to 1.070k (see figure 1). The EBITDA margin increased more than 6PP to 15.5%. EBIT amounted to 1,057k (2016: 475k, +123%). ad pepper media s extraordinary profitability is an indication of the very high quality of its services. ad pepper s subsidiary ad pepper media is a performance marketing company which is specialised in lead generation and audience targeting. The company develops online marketing strategies for its customers in over 50 countries. ad pepper media quickly generates customised campaigns adapted to the client s target markets. Based on its unique Page 2/11

and proprietary platform ilead, the company has successfully launched and managed more than 30,000 campaigns worldwide and generated millions of qualified leads. Webgains with double-digit sales growth and lower EBITDA The Webgains segment posted a 17% y/y rise in revenues to 51.4m (see figure 1). Gross profit increased by 4% y/y to 9.6m. The gross margin eased from 21.0% to 18.7% due largely to disproportionate growth in high-volume programs. EBITDA fell 15% y/y to 1.31m due to increased operating expenses mainly related to investment into the platform. The EBITDA margin declined from 3.6% to 2.5%. EBIT was 1.10m versus 1.56m in 2016, -29%). In our view, the investment has already started to pay off, as Q4/17 was the strongest quarter ever in terms of sales and EBITDA. The latter reached 755k, a 52% rise over the previous year s period result of 498k. The segment EBITDA margin in Q4/17 was 4.8% (Q4/16: 3.6%). ad pepper s subsidiary Webgains is an affiliate network which gives its 2,000+ customers access to over 250,000 publishers. In 2018E, investments in technology and personnel (increase from 87 to 100) should pay off. Webgains focuses on artificial intelligence (cooperation with IBM Watson) and machine learning to further simplify the quick roll-out of scalable international campaigns. ad agents with strongest segment sales growth ad agents had a very successful year with sales increasing by almost 45% y/y to 17.4m. Gross profit amounted to 5.3m (2016: 4.3m, +23%). The gross margin declined from 35.7% to 30.3% due to the substantial rise in media services performed in connection with Google searches. EBITDA rose moderately by almost 9% y/y to 1.26m due mainly to investments which increased segment OPEX. ad agents increased its personnel by 17 to 68 (+33%). The EBITDA margin fell more than 2PP to 7.3% (see figure 1). Segment EBIT amounted to 1.21m (2016: 1.13m, +8%). ad agents benefited from the broadening of its service offer and became a leading provider of Amazon marketing services and analytics for Amazon sellers. ad pepper s subsidiary ad agents is a full-service performance marketing agency. For many years, customers across many industries have relied on ad agent s digital marketing campaigns due to their outstanding results. As a full-service agency, ad agent has an overview of the entire digital advertising market and provides strategies across all digital channels and devices. We believe that the investments made in 2017 will pave the way for further profitable growth. Admin segment with moderate cost decrease The Admin segment, which contains the holding costs, reported EBIT of -1.46m versus -1.54m in 2016. The cost basis declined 5% y/y. This cost-efficient holding structure is the result of the restructuring initiated back in 2014, which established a decentralised company structure giving the operating segments significant decision autonomy and restricting the holding functions and resources to the necessary functions such as internal controlling and compliance as well as group accounting & financing, and investor relations. New IFRS standard results in lower revenues On 1 January 2018, IFRS 15 came into effect and replaced several different sales recognition standards by uniform rules. This rule results in lower revenues at the Webgains segment as the website fee to be paid to publishers (affiliate commission) will in the future no longer be recognised as external revenues and cost of sales. IFRS 15 is the new industry standard and will be applied by Axel Springer SE (Awin affiliate network), ad pepper, and other affiliate networks. Since profitability figures, such as EBITDA, remain unchanged, ad pepper s EBITDA margin will increase significantly. Had the standard already been applied to the 2017 financial figures, revenues at Webgains would have amounted to 10.0m instead of 51.4m. Since Webgains EBITDA remains on the same level ( 1.31m), the segment margin would have been 13.1% instead of 2.5%. Group revenues would have amounted to 34.1m instead of 75.6m. Group EBITDA would still have been 2.2m resulting in a considerably higher group EBITDA margin of 6.5% instead of 2.9%. Page 3/11

Buoyant digital marketing sector supports growth The global digital marketing sector looks set to grow at double-digit rates in coming years. E-commerce is gaining market share, and advertising budgets are moving from offline media to the online world. In 2017, global digital advertising spending reached $209bn (+17% y/y) and exceeded TV advertising ($178bn) for the first time. In its winter update of December 2017, MAGNA, the central intelligence unit of IPG Mediabrands, predicts global digital ad spending will grow 13% to $237bn in 2018. Forecasts adjusted for new IFRS standard We have lowered our revenue forecasts in compliance with the new IFRS 15 standard. Our earnings forecast remain unchanged (see figure 2). We expect strong EPS growth in 2018E and the following years. Figure 2: Revisions to forecasts 2018E 2019E 2020E All figures in m Old New Delta Old New Delta Old New Delta Sales 86.68 38.89-55.1% 100.46 44.54-55.7% 111.51 51.03-54.2% EBIT 3.14 3.14 0.0% 4.52 4.52 0.0% 5.80 5.80 0.0% margin 3.6% 8.1% 4.5% 10.1% 5.2% 11.4% Net income 1.56 1.56 0.0% 2.45 2.45 0.0% 3.30 3.30 0.0% margin 1.8% 4.0% 2.4% 5.5% 3.0% 6.5% EPS (diluted) 0.07 0.07 0.0% 0.11 0.11 0.0% 0.15 0.15 0.0% Source: First Berlin Equity Research Upgrade to Buy at increased price target An updated DCF model yields a 4.80 price target (previously: 4.50). Given the very strong balance sheet, the increasing profitability, and strong free cash flows, we have lowered our WACC from 11.0% to 10.5%. Following the recent share price decline we upgrade the stock from Add to Buy as the valuation upside is now >25%. Page 4/11

VALUATION MODEL DCF valuation model All figures in EUR '000 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E Net sales 38,886 44,539 51,027 56,640 62,407 68,251 74,083 79,807 NOPLAT 2,119 3,104 4,042 5,137 5,720 6,321 6,931 7,543 + depreciation & amortisation 427 404 395 433 477 519 559 597 Net operating cash flow 2,545 3,507 4,438 5,570 6,196 6,839 7,490 8,141 - total investments (CAPEX and WC) -444-442 -874 319-169 -208-251 -297 Capital expenditures -350-401 -459-510 -550-589 -626-660 Working capital -94-41 -415 829 381 381 376 363 Free cash flows (FCF) 2,102 3,066 3,564 5,889 6,027 6,631 7,240 7,843 PV of FCF's 1,954 2,580 2,713 4,058 3,759 3,742 3,696 3,624 All figures in thousands PV of FCFs in explicit period (2018E-2032E) 47,603 PV of FCFs in terminal period 30,505 Enterprise value (EV) 78,109 + Net cash / - net debt 20,127 + Investments / minority interests 3,294 Shareholder value 101,530 Fair value per share in EUR 4.80 Terminal growth rate WACC 10.5% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% Cost of equity 10.5% 6.5% 7.51 7.85 8.25 8.75 9.37 10.16 11.22 Pre-tax cost of debt 6.0% 7.5% 6.43 6.64 6.89 7.19 7.55 7.98 8.53 Tax rate 30.0% 8.5% 5.62 5.77 5.93 6.12 6.34 6.61 6.92 After-tax cost of debt 4.2% 9.5% 5.01 5.11 5.22 5.35 5.49 5.66 5.86 Share of equity capital 100.0% 10.5% 4.52 4.59 4.67 4.76 4.86 4.97 5.10 Share of debt capital 0.0% 11.5% 4.13 4.18 4.24 4.30 4.37 4.45 4.54 12.5% 3.81 3.85 3.89 3.93 3.99 4.04 4.10 Fair value per share in EUR 4.80 13.5% 3.54 3.57 3.60 3.63 3.67 3.71 3.76 * for layout purposes the model shows numbers only to 2025, but runs until 2032 WACC Page 5/11

INCOME STATEMENT All figures in EUR '000 2015A 2016A 2017A 2018E 2019E 2020E Revenues 56,009 61,164 75,563 38,886 44,539 51,027 Cost of goods sold 40,165 45,076 57,215 17,287 19,919 23,472 Gross profit 15,844 16,088 18,348 21,599 24,620 27,555 S&M 10,575 9,055 10,771 11,615 12,730 13,973 G&A 6,382 6,155 6,087 7,021 7,540 8,006 Other operating income 1,406 1,059 723 780 873 1,004 Other operating expenses 49 329 396 607 703 781 EBITDA 540 1,748 2,208 3,563 4,924 6,194 Depreciation and amortisation 296 140 391 427 404 395 Operating income (EBIT) 244 1,608 1,817 3,136 4,520 5,799 Net financial result 199 82-17 43 50 56 Non-operating expenses 0 0 0 0 0 0 Pre-tax income (EBT) 443 1,690 1,800 3,179 4,570 5,854 Income taxes 308 594 664 1,017 1,417 1,756 Minority interests -168-467 -556-600 -700-800 Net income / loss -33 629 580 1,562 2,453 3,298 Diluted EPS (in ) 0.00 0.03 0.03 0.07 0.11 0.15 Ratios Gross margin 28.3% 26.3% 24.3% 55.5% 55.3% 54.0% EBITDA margin on revenues 1.0% 2.9% 2.9% 9.2% 11.1% 12.1% EBIT margin on revenues 0.4% 2.6% 2.4% 8.1% 10.1% 11.4% Net margin on revenues -0.1% 1.0% 0.8% 4.0% 5.5% 6.5% Tax rate 69.5% 35.1% 36.9% 32.0% 31.0% 30.0% Expenses as % of revenues S&M 18.9% 14.8% 14.3% 29.9% 28.6% 27.4% G&A 11.4% 10.1% 8.1% 18.1% 16.9% 15.7% Depreciation and amortisation 0.5% 0.2% 0.5% 1.1% 0.9% 0.8% Other operating expenses 0.1% 0.5% 0.5% 1.6% 1.6% 1.5% Y-Y Growth Revenues n.a. 9.2% 23.5% -48.5% 14.5% 14.6% Operating income n.a. 559.0% 13.0% 72.6% 44.1% 28.3% Net income/ loss n.a. n.m. -7.8% 169.3% 57.1% 34.4% Page 6/11

BALANCE SHEET All figures in EUR '000 2015A 2016A 2017A 2018E 2019E 2020E Assets Current assets, total 27,726 28,672 34,896 37,294 41,280 46,423 Cash and cash equivalents 16,932 17,859 20,127 22,272 25,387 29,007 Short-term investments 297 138 27 27 27 27 Receivables 9,983 10,116 14,129 14,382 15,253 16,776 Inventories 0 0 0 0 0 0 Other current assets 514 559 613 613 613 613 Non-current assets, total 6,314 2,706 3,719 3,642 3,639 3,703 Property, plant & equipment 150 212 424 411 424 476 Goodwill & other intangibles 349 572 362 298 282 294 Other assets 5,815 1,922 2,933 2,933 2,933 2,933 Total assets 34,040 31,378 38,615 40,936 44,919 50,126 Shareholders' equity & debt Current liabilities, total 17,436 16,282 21,696 21,856 22,685 23,793 Short-term debt 0 0 0 0 0 0 Accounts payable 13,618 12,357 17,838 17,998 18,827 19,935 Current provisions 0 0 0 0 0 0 Other current liabilities 3,818 3,925 3,858 3,858 3,858 3,858 Long-term liabilities, total 96 117 402 402 402 402 Long-term debt 0 0 0 0 0 0 Deferred revenue 0 0 0 0 0 0 Other liabilities 96 117 402 402 402 402 Minority interests 503 690 779 1,379 2,079 2,879 Shareholders' equity 16,005 14,289 15,738 17,300 19,753 23,051 Share capital 1,150 1,150 1,150 1,150 1,150 1,150 Capital reserve 63,305 61,116 61,312 61,312 61,312 61,312 Other reserves -2,199-2,356-1,683-1,683-1,683-1,683 Loss carryforward / retained earnings -46,250-45,621-45,041-43,479-41,026-37,728 Total consolidated equity and debt 34,040 31,378 38,615 40,936 44,919 50,126 Ratios Current ratio (x) 1.59 1.76 1.61 1.71 1.82 1.95 Quick ratio (x) 1.59 1.76 1.61 1.71 1.82 1.95 Net debt -17,229-17,997-20,154-22,299-25,414-29,034 Net gearing -107.6% -126.0% -128.1% -128.9% -128.7% -126.0% Equity ratio 48.5% 47.7% 42.8% 45.6% 48.6% 51.7% Book value per share (in ) 0.75 0.67 0.74 0.81 0.93 1.08 Return on equity (ROE) -0.2% 4.4% 3.7% 9.0% 12.4% 14.3% Return on investment (ROI) -0.1% 2.0% 1.5% 3.8% 5.5% 6.6% Return on assets (ROA) 0.1% 2.2% 1.5% 3.8% 5.5% 6.6% Days of sales outstanding (DSO) 65.1 60.4 68.2 135.0 125.0 120.0 Days inventory outstanding 0.0 0.0 0.0 0.0 0.0 0.0 Days in payables (DIP) 123.8 100.1 113.8 380.0 345.0 310.0 Page 7/11

CASH FLOW STATEMENT All figures in EUR '000 2015A 2016A 2017A 2018E 2019E 2020E EBIT 244 1,608 1,817 3,136 4,520 5,799 Depreciation and amortisation 296 140 391 427 404 395 EBITDA 540 1,748 2,208 3,563 4,924 6,194 Changes in working capital 2,257-1,164 3,095-94 -41-415 Other adjustments -1,014-561 -2,203-974 -1,367-1,701 Operating cash flow 1,783 23 3,100 2,495 3,516 4,079 Investments in PP&E -67-144 -378-233 -267-306 Investments in intangibles -118-417 -55-117 -134-153 Free cash flow 1,598-538 2,666 2,145 3,115 3,619 Acquisitions & disposals, net 3,363 3,920 3 0 0 0 Other investments 16 209 0 0 0 0 Investment cash flow 3,194 3,568-431 -350-401 -459 Debt financing, net 0 0 0 0 0 0 Equity financing, net 176-2,217 105 0 0 0 Dividends paid 0 0 0 0 0 0 Other financing 0-280 -467 0 0 0 Financing cash flow 176-2,497-362 0 0 0 FOREX & other effects 8-167 -39 0 0 0 Net cash flows 5,162 927 2,268 2,145 3,115 3,619 Cash, start of the year 11,926 16,932 17,859 20,127 22,272 25,387 Cash, end of the year 17,088 17,859 20,127 22,272 25,387 29,007 EBITDA/share (in ) 0.03 0.08 0.10 0.17 0.23 0.29 Y-Y Growth Operating cash flow n.a. -98.7% 13378.3% -19.5% 40.9% 16.0% Free cash flow n.a. n.m. n.m. -19.6% 45.3% 16.2% EBITDA/share n.a. 227.8% 26.3% 60.4% 38.2% 25.8% Page 8/11

FIRST BERLIN Equity Research FIRST BERLIN RECOMMENDATION & PRICE TARGET HISTORY Report No.: Initial Report Date of publication Previous day closing price Recommendation Price target 9 January 2018 4.06 Add 4.30 2...1 2 25 January 2018 4.42 Add 4.50 3 Today 3.68 Buy 4.80 Authored by: Dr. Karsten von Blumenthal, Analyst Company responsible for preparation: First Berlin Equity Research GmbH Mohrenstraße 34 10117 Berlin Tel. +49 30 80 93 96 85 Fax +49 (0)30-80 93 96 87 info@firstberlin.com www.firstberlin.com Person responsible for forwarding or distributing this financial analysis: Martin Bailey Copyright 2018 First Berlin Equity Research GmbH No part of this financial analysis may be copied, photocopied, duplicated or distributed in any form or media whatsoever without prior written permission from First Berlin Equity Research GmbH. First Berlin Equity Research GmbH shall be identified as the source in the case of quotations. Further information is available on request. INFORMATION PURSUANT TO SECTION 34B OF THE GERMAN SECURITIES TRADING ACT [WPHG], TO REGULATION (EU) NO 596/2014 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF APRIL 16, 2014, ON MARKET ABUSE (MARKET ABUSE REGULATION) AND TO THE GERMAN ORDINANCE ON THE ANALYSIS OF FINANCIAL INSTRUMENTS [FINANV] First Berlin Equity Research GmbH (hereinafter referred to as: First Berlin ) prepares financial analyses while taking the relevant regulatory provisions, in particular the German Securities Trading Act [WpHG], Regulation (EU) No 596/2014 of the European Parliament and of the Council of April 16, 2014, on market abuse (market abuse regulation) and the German Ordinance on the Analysis of Financial Instruments [FinAnV] into consideration. In the following First Berlin provides investors with information about the statutory provisions that are to be observed in the preparation of financial analyses. First Berlin F.S.B. Investment-Beratungsgesellschaft mbh (hereafter FBIB), a company of the First Berlin Group, holds a stake of under 0.1% of the shares in the company which has been covered in this analysis. The analyst is not subject to any restrictions with regard to his recommendation and is therefore independent, so that we believe there is no conflict of interest. CONFLICTS OF INTEREST In accordance with Section 34b Paragraph 1 of the German Securities Trading Act [WpHG] and Regulation (EU) No 596/2014 of the European Parliament and of the Council of April 16, 2014, on market abuse (market abuse regulation) financial analyses may only be passed on or publicly distributed if circumstances or relations which may cause conflicts of interest among the authors, the legal entities responsible for such preparation or companies associated with them are disclosed along with the financial analysis. First Berlin offers a range of services that go beyond the preparation of financial analyses. Although First Berlin strives to avoid conflicts of interest wherever possible, First Berlin may maintain the following relations with the analysed company, which in particular may constitute a potential conflict of interest (further information and data may be provided on request): The author, First Berlin, or a company associated with First Berlin holds an interest of more than five percent in the share capital of the analysed company; The author, First Berlin, or a company associated with First Berlin provided investment banking or consulting services for the analysed company within the past twelve months for which remuneration was or was to be paid; The author, First Berlin, or a company associated with First Berlin reached an agreement with the analysed company for preparation of a financial analysis for which remuneration is owed; The author, First Berlin, or a company associated with First Berlin has other significant financial interests in the analysed company; In order to avoid and, if necessary, manage possible conflicts of interest both the author of the financial analysis and First Berlin shall be obliged to neither hold nor in any way trade the securities of the company analyzed. The remuneration of the author of the financial analysis stands in no direct or indirect connection with the recommendations or opinions represented in the financial analysis. Furthermore, the remuneration of the author of the financial analysis is neither coupled directly to financial transactions nor to stock exchange trading volume or asset management fees. If despite these measures one or more of the aforementioned conflicts of interest cannot be avoided on the part of the author or First Berlin, then reference shall be made to such conflict of interest. INFORMATION PURSUANT TO SECTION 64 OF THE GERMAN SECURITIES TRADING ACT [WPHG] (2ND FIMANOG) OF 23 JUNE 2017, DIRECTIVE 2014/65/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF 15 MAY 2014 ON MARKETS IN FINANCIAL INSTRUMENTS AND AMENDING DIRECTIVE 2002/92/EC AND DIRECTIVE 2011/61/EU, ACCOMPANIED BY THE MARKETS IN FINANCIAL INSTRUMENTS REGULATION (MIFIR, REG. EU NO. 600/2014) First Berlin notes that is has concluded a contract with the issuer to prepare financial analyses and is paid for that by the issuer. First Berlin makes the financial analysis simultaneously available for all interested security financial services companies. First Berlin thus believes that it fulfils the requirements of section 64 WpHG for minor non-monetary benefits. Page 9/11

FIRST BERLIN Equity Research PRICE TARGET DATES Unless otherwise indicated, current prices refer to the closing prices of the previous trading day. AGREEMENT WITH THE ANALYSED COMPANY AND MAINTENANCE OF OBJECTIVITY The present financial analysis is based on the author s own knowledge and research. The author prepared this study without any direct or indirect influence exerted on the part of the analysed company. Parts of the financial analysis were possibly provided to the analysed company prior to publication in order to avoid inaccuracies in the representation of facts. However, no substantial changes were made at the request of the analysed company following any such provision. ASSET VALUATION SYSTEM First Berlin s system for asset valuation is divided into an asset recommendation and a risk assessment. ASSET RECOMMENDATION The recommendations determined in accordance with the share price trend anticipated by First Berlin in the respectively indicated investment period are as follows: STRONG BUY: An expected favourable price trend of more than 50% combined with sizeable confidence in the quality and forecast security of management. BUY: An expected favourable price trend of more than 25% percent. ADD: An expected favourable price trend of between 0% and 25%. REDUCE: An expected negative price trend of between 0% and -15%. SELL: An expected negative price trend of more than -15%. RISK ASSESSMENT The First Berlin categories for risk assessment are low, average, high and speculative. They are determined by ten factors: Corporate governance, quality of earnings, management strength, balance sheet and financial risk, competitive position, standard of financial disclosure, regulatory and political uncertainty, strength of brandname, market capitalisation and free float. These risk factors are incorporated into the First Berlin valuation models and are thus included in the target prices. First Berlin customers may request the models. INVESTMENT HORIZON Unless otherwise stated in the financial analysis, the ratings refer to an investment period of twelve months. UPDATES At the time of publication of this financial analysis it is not certain whether, when and on what occasion an update will be provided. In general First Berlin strives to review the financial analysis for its topicality and, if required, to update it in a very timely manner in connection with the reporting obligations of the analysed company or on the occasion of ad hoc notifications. SUBJECT TO CHANGE The opinions contained in the financial analysis reflect the assessment of the author on the day of publication of the financial analysis. The author of the financial analysis reserves the right to change such opinion without prior notification. 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The result of a financial analysis always describes only one possible future development the one that is most probable from the perspective of the author of a number of possible future developments. Any and all market values or target prices indicated for the company analysed in this financial analysis may not be achieved due to various risk factors, including but not limited to market volatility, sector volatility, the actions of the analysed company, economic climate, failure to achieve earnings and/or sales forecasts, unavailability of complete and precise information and/or a subsequently occurring event which affects the underlying assumptions of the author and/or other sources on which the author relies in this document. Past performance is not an indicator of future results; past values cannot be carried over into the future. Consequently, no warranty of any kind whatsoever shall be assumed for the accuracy of estimates and forecasts, and neither the author nor First Berlin, nor the person responsible for passing on or distributing the financial analysis shall be liable for any direct or indirect damage incurred through reliance on the correctness of estimates and forecasts. INFORMATION PURPOSES, NO RECOMMENDATION, SOLICITATION, NO OFFER FOR THE PURCHASE OF SECURITIES The present financial analysis serves information purposes. It is intended to support institutional investors in making their own investment decisions; however in no way provide the investor with investment advice. Neither the author, nor First Berlin, nor the person responsible for passing on or distributing the financial analysis shall be considered to be acting as an investment advisor or portfolio manager vis-à-vis an investor. Each investor must form his own independent opinion with regard to the suitability of an investment in view of his own investment objectives, experience, tax situation, financial position and other circumstances. Page 10/11

FIRST BERLIN Equity Research The financial analysis does not represent a recommendation or solicitation and is not an offer for the purchase of the security specified in this financial analysis. Consequently, neither the author nor First Berlin, nor the person responsible for passing on or distributing the financial analysis shall as a result be liable for losses incurred through direct or indirect employment or use of any kind whatsoever of information or statements arising out of this financial analysis. A decision concerning an investment in securities should take place on the basis of independent investment analyses and procedures as well as other studies including, but not limited to, information memoranda, sales or issuing prospectuses and not on the basis of this document. NO ESTABLISHMENT OF CONTRACTUAL OBLIGATIONS By taking note of this financial analysis the recipient neither becomes a customer of First Berlin, nor does First Berlin incur any contractual, quasi-contractual or pre-contractual obligations and/or responsibilities toward the recipient. In particular no information contract shall be established between First Berlin and the recipient of this information. NO OBLIGATION TO UPDATE First Berlin, the author and/or the person responsible for passing on or distributing the financial analysis shall not be obliged to update the financial analysis. Investors must keep themselves informed about the current course of business and any changes in the current course of business of the analysed company. DUPLICATION Dispatch or duplication of this document is not permitted without the prior written consent of First Berlin. SEVERABILITY Should any provision of this disclaimer prove to be illegal, invalid or unenforceable under the respectively applicable law, then such provision shall be treated as if it were not an integral component of this disclaimer; in no way shall it affect the legality, validity or enforceability of the remaining provisions. APPLICABLE LAW, PLACE OF JURISDICTION The preparation of this financial analysis shall be subject to the law obtaining in the Federal Republic of Germany. The place of jurisdiction for any disputes shall be Berlin (Germany). NOTICE OF DISCLAIMER By taking note of this financial analysis the recipient confirms the binding nature of the above explanations. By using this document or relying on it in any manner whatsoever the recipient accepts the above restrictions as binding for the recipient. QUALIFIED INSTITUTIONAL INVESTORS First Berlin financial analyses are intended exclusively for qualified institutional investors. This report is not intended for distribution in the USA, Canada and/or the United Kingdom (Great Britain). Page 11/11